On January 1, 2016, Flash and Dash Company adopted a healthcare plan for its retired employees....

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On January 1, 2016, Flash and Dash Company adopted a healthcare plan for its retired employees....

On January 1, 2016, Flash and Dash Company adopted a healthcare plan for its retired employees. To determine eligibility for benefits, the company retroactively gives credit to the date of hire for each employee. The following information is available about the plan:

Service cost	$32,550
Accumulated postretirement benefit obligation (1/1/16)	122,400
Expected return on plan assets	0
Amortization of Prior service cost	10,200
Payments to retired employees during 2016	4,280
Interest rate	10%
Average remaining service period of active plan participants (1/1/16)	12 years

Required:

1.	Compute the OPRB expense for 2016 if the company uses the average remaining service life to amortize the prior service cost.
2.	Prepare all the required journal entries for 2016 if the plan is not funded.

business accounting

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Answer 1

Answer #1

(1) (+) Computation of OPRB expenne And inf Service cost- 32,550 Interest Cost - 12, 240 (122400 x 107.) Expected Return on P

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Answer 2

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On January 1, 2016, Flash and Dash Company adopted a healthcare plan for its retired employees....

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